"This means that the credit union is closed, and members cannot take any money out of their accounts and we cannot accept money in either, from today."

No further information is given as to the nature of the problem, and a quick google and search of the FSA site leaves me equally uninformed. At the time of writing the Hackney Credit Union site does not even appear to have been updated to reflect the content of the letter posted out.

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Shit! If you got the letter this morning, I guess it was probably posted Friday. So this is really last week's news. It will affect a lot of people, most of whom don't have much money.

The freezing of accounts is serious financial malky. What are the council and the MPs doing to at least find out what's happening and let people know? Err....don't hold your breath.

The council's web site has a glitzy pic of Jules Pipe cutting the ribbon to open HCU 5 years ago. Will he be there stitching it back together now? Will we get a full update in the next issue of Hackney Toady? Don't hold your breath.

What protection is there for people with savings in, or loans from, credit unions? I don't know. Who does?

The FSA and HCU obviously owe their account holders AND the public a proper explanation of what's going down. I will take a stroll past their office later to see if there's anything more specific on display, though I doubt it.

If you've got an account with HCU (which I haven't) why not try emailing the FSA? It may be they're willing to be more forthcoming than HCU have been.

Ah, what a testament to progress Hackney is these days! The Ocean, the Empire, the £6m bus stop at Dalston Junction, and now the Credit Union banged up.

Meantime, the excellent Dalston Lane squatters (who've been there up to 9 years) are facing eviction, so those houses can get trashed and set on fire, whilst the other hard-grafting and inspired people who've made 195 Mare Street such a worthwhile resource for local people over the last few months are due in court on 26th.

Seems the Financial Services Compensation Scheme will ensure people get their money back eventually. But "eventually" is no good for people who were getting wages or benefits paid into HCU accounts, is it?

about a similar sudden closure of a credit union in Rochdale. The big difference there is what a councillor is quoted as saying:

“There are many people who draw their benefits from StreetCred which has left people in dire straits. It is up to us to make sure these people get their benefits.”

Any of that "up to us" approach from Hackney? Nah, all we'll get is another "it's not my fault" quote from Jules Pipe. The only thing he sees as up to him is getting publicity when it opened.

Also, it's clear if you read that story that the council were in close touch with the situation before the collapse actually happened and were the first to be told when the credit union concluded it had to fold. Is Hackney on top of the situation in the same way? Were they preparing plans over the last couple of weeks, ready to "roll out" (as they'd call it) if the worst happened.

If people had wages or benefits electronically deposited to HCU, all they need do is designate another method of payment *immediately*, for the HCU is incapable of "accepting" any funds.

Members should also remember that as a not-for-profit organisation, *they* directly own and control the HCU, as well as each and every person they elect or employ. Neither Jules Pipe, members of the Council nor the rubbish collector has *anything* to do with the HCU or its control.

Let's get back to basics, this so-called credit union was most likely set-up with Hackney citizens' money (as an ego trip for local politicians) and was then given a prime(ish) office on Mare Street at what is certain to have been a peppercorn rent.

It was at first aggresively marketed at the poor and the desperate of Hackney (although its website has never once been updated) and supposedly it was staffed by volunteers (although it was hardly ever open and when it was, provided no seating nor heating to any of its elderly customers who were made to stand hours in line as if in soviet soup-kitchen). So how exactly has it now gone bust?

Where has our money gone? Claiming from the Compensation Scheme just means we customers of this failed 'regulated' deposit-taking bank are being bailed out once again by other tax-payers instead of by the real 'culprits'..

Who has taken our money from what was in essence an empty charity-shop incredibly licensed to take people's deposits? Who was running this apparent 'ponzi scheme' openly operating on our high street? And who allowed them to prey on investors?

What were the regulators doing to allow this situation to carry on? The FSA, the so called regulator, has let Northern Rock, RBS and untold number of credit unions go bust -doesn't it ever ask who is taking peoples' money? Scrap it now.

Something is rotten in the borough of Hackney. Doesn't surprise me since Hackney Council basically tried to steal my grandmother's pension money a few years back. Took us a minute to figure out why the nursing home was claiming her payments weren't coming through... supposedly a "mistake" but I'm 100% sure someone thought they could get away with t'iefing money from a 90-something year old cos they thought she wouldn't notice and would have no one to back her.

Sorry to disappoint but we've never trusted the whole CU set up in the UK from the outset. Too many unqualified and frankly incompetent but well meaning middle class apparatchniks involved busy ticking boxes. Challenges we made about competence were met with vitriolic defence of their moral position with no acknowledgment of their obvious failure to behave professionally. At one stage we discovered we had 4 accounts registered when only one was applied for. Questions about the honesty and quality of an appointee were also met with a "how dare you" reposte. We fear that this is just another saga in the slow collapse of the whole idea of the people's bank.

"Neither Jules Pipe, members of the Council nor the rubbish collector has *anything* to do with the HCU or its control."

True, but they had a lot to do with exploiting it for propaganda when the Mare Street office was opened. Also, the council has been active in advising and directing people who can't get bank accounts towards the CU. They did regard it as one of "their" wee jewels until now.

It's typical of Pipe, Akehurst etc. just to walk away when it goes tits up. In strict legal terms, they may have nothing to do with it, but practically and morally they were in it up to their necks.

Anyway, this is a disaster for people whose money is now frozen for months and who'll find it very difficult, if not impossible, to get accounts elsewhere. But it still hasn't happened according to the council's website. Plenty about foxes (which, I believe, don't take their instructions from the council either) but nary a mention of the CU collapse. So much for "leaders", eh?

They say:
"We’re on your side during tough times."
But not if you've been shafted by the CU going down. That's a bit too close to home, too embarrassing, see.

There are rumours of this being precipitated by £100,000 or some such sum going walkies. If there's any truth in that (not saying there is) it's likely to mean people have to wait even longer to get their money back.

I note one of the founding directors of Hackney Credit Union (and who is currently on its supervisory committee) is also a full board member of the Financial Services Authority (which supposedly regulates Hackney Credit Union and is there to prevent it from going bust ... together with HCU's own supervisory committee of course ...)

Perhaps he knows something about an alleged £100k going 'walkies'?

Too much to hope he knows which bit of that £100k is my money and where that bit has decided to walk off to though ...

The "missing" £100,000 is only a rumour, so shouldn't be confused with a fact. The trouble, of course, is there are no facts available to ordinary punters, except that you can't get your money and if you need it to feed your kids or pay your rent, tough shit. It that climate secrecy, it's no wonder rumours abound.

Someone above compared the CU to a soviet soup kitchen. Ha! The FSA and Hackney Council appear to have soviet approaches to news and crisis management, too. The council's head is still in the sandbucket.

I have emailed the boss of Hackney homes today to ask what they're going to do about people who have accounts with HCU and are on full HB, who now can't pay their water rates, people on partial HB who can't pay the part of the rent which is down to them, and even people not on HB who can't pay their rent. I've so far had a holding reply from a senior flunkey promising a response to the issue soon.

The same questions (except for water rates) need to be asked of those lovely housing associations who run so much of the local housing stock.

I see no point or benefit in blaming Jules Pipe or the council for this - they welcomed the credit union for good reasons. CU's have a track record of helping vulnerable people reach credit and banking facilities and reducing personal debt. You wouldn't blame local politicians who opened a new bank if it got burgled later. (well most of you wouldn't).

It's also true there is no need to panic in the long term - one of the advantages of credit unions is that because they club together, they ensure there is a compensation scheme, so if one goes wrong it gets sorted out.

What the council should do is try and help those for whom long term compensation is not what they need - they need short term help with rent/bills etc.

But it would be helpful if people asked the council to provide this kind of support, rather than whinging on about a closure that has nothing to do with them. If you just blame Jules Pipe you simply give him an excuse to point out its not him that caused the problem.

Why not be honest it wasn't his fault, and ask what he can do to help instead. He may say nothing, but that does look pretty heartless.

Jules Pipe's paw prints are -sorry were- all over this project. Now, of course, it's got nothing to do with him or the council.

Martyn is right that the council should be trying to help those who are landed in the immediate short-term shit. Are they? Are they showing the same sense of responsibility which I quoted from Rochdale council when the CU there failed? Are they buggery!

Council web site still contains the same old lie:

"We’re on your side during tough times."

But not in this case. Nothing at all has happened as far as the council is concerned.

OK first of all @Frogeye it may be the case that "all they need do is designate another method of payment *immediately*," however lots of the credit union members won't have another method of receiving payments. If they did they probably wouldn't be using the credit union to do so. Of course some will be able to go back to using Post office Card Accounts but the intervening weeks while their payments get sorted will be extremely hard on these people with many of them getting into debt in order to make ends meet and/or will end up in arrears with bills and rent.

There are still over £1m people in the UK without bank accounts and many of them are using credit union accounts wherever possible as a stepping stone account. Getting a basic bank account if you don't have a passport or a driving licence and pay your bills on a key meter instead of by direct debit is very hard. There isn't any "all they need to do" about it.

Secondly @An_idiot_who_deposited_money_with_HCU when claiming from the FSCS you are not "being bailed out once again by other tax-payers instead of by the real 'culprits'.." but by other financial services firms. The FSCS is administered by the government but the compensation money comes from banks, insurers, brokers, IFAs etc. Get your facts straight.

That said there have been rumours for some time that Hackney CU was living on borrowed time. They hadn't been screening their borrowers effectively nor had they been driving hard enough to get more comfortably off members in to subsidise the poorer and more high risk borrowers.

I'm sorry to see it's gone though. As above a lot of people will suffer as a result of this and the damage may well be much longer lasting than you might think. Many of the poorer members live very unstable lives and one little thing going wrong can trigger a chain reaction that sends everything into chaos (mental health, substance misuse, physical health, relationships, everything).

Not surprised really to hear that the credit union failed once again as it is not the first time. I once was a member with the credit union when it was first established in Hoxton street, then trading and known under the name of hoxton and shoreditch credit union. That too went into administration and despite all the investigations and meetings that took place with members and management, still no one was held responsible for why it collasped.

And now its happened again several years later despite all the publicity, new premises and supposedly experienced staff. Turns out that most of them were volunteers and for most of the time clueless.

For the credit union to collaspe again is sending signals to me that this is beginning to look rather too fishy for my liking.........two credit unions failing and yet no one knows why.
Surely its just an undercover approach for hackney borough to bail themselves out of their never ending debt by taking our savings and then expecting the FSA to compensate.

Great post. A coworker suggested that I switch from a back to a credit union. I just don't know a lot about it so I was looking up credit unions in Oklahoma city to get a little more information. That is awful what happened. I would have to have my account frozen, especially if I did nothing wrong. Thanks for sharing.

The Credit Unions, Banks or other lending arms as GMAC that are traditionally lending source do not generally amuse or pre-approve for bad credit. They strictly avoid the low credit scores, bankruptcy, any previous recovery or low income. And same what’s happening with Hackney’s credit union, as people were jumping around for their money for which they were not either enrolled. There were many big issues which have to be cleared first before clearing others money or looking towards any favor.